Are budget norms relevant to the dynamics of Government fiscal indicators? The case of Italy (1948-2014)

We study the evolution of budget norms in Italy since the Second World War in order to evaluate their impact, if any, on the main Government fiscal indicators, such as public deficits and debt, public expenditures and tax burden. In order to study this issue in the Italian context, we construct an index broadly based on the work of Von Hagen (1992), with some differences related to the need to study a single country's fiscal performance over a quite long period of time. The index is composed of four sections representing the budgeting process. The scores, obtained from the index and related to the evolution of budget norms in Italy, are considered to empirically evaluate the impact of budget norms on government's fiscal indicators in the period under consideration